Bullish Q&A: Caring for Financially Irresponsible Parents

Hi Jen. I like to plan, I have worked hard and am doing well. I like knowing that my finances are set up to ensure I will have enough money for retirement, that my career plan has a healthy rate of growth, and that I’m well insured in all areas. But what about the care of elderly parents? My parents have “joked” that I’m the successful/educated/financially-sensible one of the family, so they’ll enjoy a comfortable retirement. Obviously I will be willing to care for them, that isn’t my concern. They have always been very irresponsible with money, living a lavish lifestyle funded by debt, never really paying down their mortgage or having any valuable assets. Do you think it’s appropriate for me to now encourage them to take a bit more responsibility for their own finances (in their last decade or so of working), given that they are likely to be depending on me in the future? And how?!

YES. You should talk to them about this, immediately.

Start by playing dumb a little bit. “Hey, you’ve been throwing around some ‘jokes’ that you want me to take care of you financially when you’re old. Is that, uh, what you want from me for real?”

If they say something general, like “We’ve given you everything — of course we expect you to take care of us,” keep playing dumb.

“What does that mean? I don’t really know anyone who does this, so can you explain? Like you want me to pay your rent every month? Like at some point I would start paying certain bills that you have? Or is it just that I would keep you not-homeless in case of a serious emergency?”

Get an actual answer from them. Play dumb, be their kid. In real life, you’re a responsible adult — but they’re trying to use that against you. So turn it off for a minute. Pretend you’re 14. They want you to pay their rent?

Get them to nail down what they actually expect.

And then, even if you’re okay with what it is they want, don’t agree to anything or let them off the hook. Point out that you wouldn’t be able to pay any debts they have, so they will need to become debt-free and to pare down their expenses by the time you start “helping.”

Point out that it would be “impossible” for you to fund their current lifestyle. By the time they are depending on you, they’ll need to live on a budget, so you think you should help them work out a budget now so they can get used to that. (“Part of paying monthly bills is managing where the money is coming from and where it’s going. You can’t have one without the other.”)

If they balk at sharing any financial information with you, budgeting, or talking about or paying down debt, tell them you’ll be there in case of real emergency, but you can’t consider helping them in a more consistent way until you work this out.

For people like your parents who sound overwhelmed, used to doing it (or not doing it) their own way, and bad at math, be clear about what it means to “work this out” — it would probably take at least a month for them to get all the paperwork and information you need, and then you’d spend 2-3 days together, over the course of a visit, getting their finances in order and developing a plan. If you only see your parents a few times a year, you could even suggest, “How about we do this when I come for Thanksgiving?” Give them awhile to get there, but get it on the calendar.

Finally, you didn’t mention whether you plan on having children. That puts a huge wrinkle in the plans — and also gives you an easy way out of giving your parents anything you don’t want to. Even the most traditional parents see the wisdom of investing in the next generation. “I’m going to need that money for your grandchildren, so we have to make sure we can keep you guys housed and fed without compromising their opportunities. That’s why I live on a budget….”